The appearance of action

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There have been suggestions in the past that Scotland could overcome the Labour-Tory Westminster blockage of a new referendum on independence if an election resulted in a majority for independence in the Scottish Parliament and that parliament then declared Scotland to be an independent country. There is no legal requirement for a referendum before independence; many of the UK’s former colonies never bothered with such niceties. Some fought for their independence, others negotiated for it, some (perhaps most notably the USA) simply declared themselves independent. But one of the most important tests of whether a country can become independent without the consent of the state currently in control is the question of international recognition. A declaration of independence which no other state recognised could turn out to be pretty meaningless, leaving the administration unable to trade effectively or make any other sort of international agreements, which is a major reason for the SNP having avoided trying it to date.

Sir Starmer is right to understand the importance of international recognition in the process of establishing a Palestinian state, and were the other essentials of statehood in place, it would be a powerful step to take. The problem is that they are not – and Israel is in the process of making sure that their absence is as irrevocable as possible. Between clearing large parts of Gaza of its population, and encouraging settlers to force Palestinians from their land in the West Bank, there are no longer any clear boundaries for a Palestinian State. There may be internationally agreed lines on a map, but they are largely meaningless. Nor is there much by way of a functioning administration, which could be recognised as the ‘government’ of the new state, in large parts of the territory.

Recognition is symbolic, but of little real effect compared to the other steps that the UK could take in terms of sanctions and cessation of military exports. And delayed recognition is even less effective – merely giving the Israeli government a clear timeline in which it needs to complete the elimination of any viable Palestinian state. But then, symbolism is probably all Sir Starmer really wants: the appearance of action without making any real difference. In fact, that phrase (“the appearance of action without making any real difference”) could well come to be the defining characteristic of Starmer’s Labour. And not just in relation to Palestine.

Can Corbyn change?

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The history of setting up new parties in the UK is not exactly a trail littered by success. One of the main reasons for that is the electoral system which, as long as there are two parties generally perceived as ‘natural’ front runners, allows two main parties to shut others out by each claiming that any vote not for one is, in effect, a vote for the other. It’s a tactic which has been used for decades by Labour and Tory alike, and goes a long way to explaining why neither of those parties has ever embraced electoral reform.

One of the features of such a system, however, is that there is an inherent tipping point; once any third party reaches a certain percentage of the vote it can suddenly have the effect of shutting out one or other of the traditional two main parties. Opinion polls suggest that Reform Ltd may have reached that tipping point, although there is a lot that could, and probably will, go wrong for Farage between now and the next Westminster election. It is in that context that Corbyn and friends have decided to launch a new party. Maybe, if the old system really is reaching the end of the road, the UK could see both the two old main parties being swept aside by two new main parties, however unlikely that might seem in historical terms.

Despite agreeing with much of what Corbyn has said over the years on a range of issues, I have serious concerns about a new party led by him.

Firstly, he has never exactly been an enthusiast for electoral reform. There is, of course, an element of chicken-and-egg about the issue – the best way for a new party to break through is under an electoral system which allocates seats more accurately on the basis of votes cast, and the best way of getting that sort of electoral reform is for one of the parties which is being shut out by the current system to somehow win a majority under the current system. Serious, long term reform of the UK political system depends on implementing a change which clearly runs counter to the interests of those making the decisions. Nevertheless, a clear commitment to reform might be the best way for a new party to encourage others to support it on a one-off basis in a single election. Has Corbyn the vision to understand that?

Secondly, unless the new party can get its vote share up to around 30%, it could end up with a respectable vote in many constituencies whilst winning precisely no seats. And it could even end up losing seats for the Green Party. Success in the short term necessarily involves a willingness to form alliances. Corbyn is steeped in old Labour Party values, including the one which welcomes co-operation with other parties just as long as those other parties recognise Labour’s hegemony and do as they are told. Can Corbyn put such attitudes to one side and form the sort of cross-party alliances required to bring about electoral success – and in England, that primarily means with the Green Party?

Thirdly, Corbyn has always had a strange blind spot when it comes to Wales and Scotland. This is a man who supports national liberation struggles across the globe, and is a long-time supporter of a free and united Ireland. Yet, when it comes to those parts of the UK which don’t have a stretch of water separating them from England, he somehow seems to see the dominance of England as being part of the natural order of things. Working with others in Wales and Scotland will require a willingness to adapt his attitude towards them – has he the sense to do that?

At the moment, there’s something of a gap where detailed policies should be, and we’ll have to wait and see how that gap is filled. Vague aspirational stuff isn’t enough, even if it generates a few headlines.

When is a tax not a tax?

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The government which decided to reduce pensioner income by scrapping the Winter Fuel Allowance, and which continually hints at the ‘unaffordability’ of the pensions triple lock is, apparently, the same government which is now forecasting a ‘tsunami’ of pensioner poverty. It’s almost as though cause and effect is some sort of alien concept. They’re not alone, of course – the Tories and the Farageists are making similar noises about affordability. The alternative to funding an adequate level of pension through taxation is, it seems, for employees to save more.

Superficially, it sounds rational and logical; those of us benefitting from occupational pensions certainly understand the benefits of saving into a work-based pension plan. The difference, though, is not all it is painted as being. The state pension is nominally funded by tax deductions from employees and employers, and it’s true that those taxes might well need to increase if there are more pensioners and if the level of pensions continues to rise. Mandatory occupational pensions (the government’s preferred alternative), on the other hand, are funded by compulsory payments by employers and compulsory deductions from salary. The payments might not be defined as ‘taxes’ because the money never goes through any government accounts, but their effects on business operating costs and net disposable income are remarkably similar. It turns out that we can indeed afford to pay better pensions if the same people pay the same money to a private company and pretend that it’s nothing at all like a tax.

Whilst the difference might not be immediately obvious to those paying the contributions, there are, of course, some other differences. The first is that private pensions money is invested to pay for future benefits rather than used to pay current benefits. But the difference between an investment-based approach and the current Ponzi-scheme approach for state pensions is a matter of political choice, not an inevitable consequence of a state-run scheme. The second difference is, purely coincidentally I’m sure, that the private pensions company take a slice off the top as payment for administration and profit for their shareholders.

The biggest and most important difference is in terms of who benefits and by how much. The state pension is based on paying a single basic amount to all, even if the contribution rate is based, albeit loosely, on the income of the individual employee. There is, in that sense, an element of redistribution involved. Workplace pensions, however (and this is true, although in slightly different ways, of both defined benefit and defined contribution schemes), pay out a pension amount which is related to the payments made – and thus, in turn, to the salary of the individual. Labour’s preference for a savings-based approach to increasing pensions thus has two main financial effects – increasing profit for finance companies in the City of London, and ensuring that benefits flow to the richest rather than the poorest. All in the interests of pretending to reduce the demands on what they insist on calling ‘taxpayers’ money’ by replacing a potential tax increase with an alternative compulsory levy. It’s hard to find a clearer statement of modern-day Labour Party values.

Blurring the lines isn't firm action

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Terrorism, like some perverse form of beauty, is in the eye of the beholder. The term, ‘La terreur’, was first used during the French revolution, when it was very much a state-sponsored method of terrifying a population into submission and acceptance. It underlines the fact that there is no clear, generally-accepted definition of the term – a huge advantage for politicians since it means that they can define it any way they choose. Governments tend to use the word as a catch-all for almost anything of which they disapprove, an approach which leads to Putin using the term to justify his war in Ukraine, and Sir Starmer using it to describe a few people who try and give a new coat of paint to a couple of military aircraft. Whether that latter action actually ‘terrified’ anyone is a moot point, but it doesn’t really matter; once something has been officially defined as terrorism, almost any action is apparently justified in dealing with it.

One of the more alarming aspects of the government’s decision to proscribe a single pro-Palestine organisation is the way in which the police now seem to be extending the definition of terrorism to include anyone who supports the same aims as the proscribed organisation itself. Effectively, they’ve started arresting people (and detaining them under the more stringent conditions relating to terrorism rather than the more usual conditions for other types of crime) for declaring their support for the idea of a Palestinian state, rather than only for outright support for the proscribed organisation. Maybe individual police officers have been inadequately briefed about exactly what the law does or does not permit, but it’s hard to believe that different forces in different parts of the UK would independently have come to such a similar conclusion – which suggests at least implicit encouragement from the government.

There are probably few who would quibble with the principle of proscription as a tool to deal with an organisation taking violent action causing death or injury to citizens in an attempt to force a particular change in policy (although not quibbling with the principle isn’t the same as believing that it’s an effective approach). It ought to be possible, though, in a semi-democracy like the UK to debate when and under what conditions such a sanction should be applied and to question the way in which that sanction is then policed. The government, however, seems determined to close down any such discussion.

War, with all its accompanying death and destruction, invariably ‘radicalises’ people, to use a term generally used pejoratively these days. The horrific war in Gaza is just one example. Whether it’s always the bad thing as which it is presented is another question which they don’t want to debate. The second world war radicalised a generation of people in the UK, and the immediate post-war Labour government under Clem Attlee channelled that into making some of the most significant changes the UK has ever seen. I can’t help but wonder whether the instinctive reaction of the current day Labour Party under Sir Starmer would have been, more likely, to criminalise and imprison those who had been radicalised. Few people in the UK actually support ‘real’ terrorism, but forever extending the definition of the term blurs the lines. It might look like firm action, but it is likely to make enforcement harder rather than easier.

Accumulating wealth isn't the same thing as creating it

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‘Wealth’ is a strange thing. Most of us know whether we’ve got it or not, but that’s not the same as knowing what it is, or where it comes from. And that’s important when it comes to the question of taxing it, a question which has gained a lot of prominence recently. Partly because identifying what it is isn’t exactly a straightforward task, it’s far from easy to tax it; it is a great deal easier to tax income arising from it, as discussed in a previous post. There’s also a lot of confusion between being wealthy and creating wealth, as some of the reports suggesting that millionaires and wealth creators will leave the UK if they are taxed at a higher rate illustrate.

For most of us, our ‘wealth’ is almost entirely a result of home ownership: take away the ‘value’ of our homes and we have very little left. That property-based wealth certainly seems to be growing, but who is actually ‘creating’ that extra wealth? It’s not home owners – they do nothing except buy a house and watch the monetary value increase over time. Another form in which much of the UK’s private ‘wealth’ is held is stocks and shares. But those who buy shares aren’t investing in the companies – the companies don’t see a penny of the value of share sales. Most business investment comes from commercial loans, not share issues. The value of those stocks and shares might increase over time, adding to the total stock of wealth, but who is ‘creating’ that extra wealth? It certainly isn’t the shareholders, yet they are the ones benefitting from that increase in value. Most of those who can be described as millionaires in the UK are actually wealth accumulators, not wealth creators.

It means that we need to examine rather more carefully the bleating of those who claim that taxes on wealth (or the income derived from wealth) will drive wealth creators to leave the country. Most of them aren’t even wealth creators in any meaningful sense in the first place. There’s also a question about the extent to which they can really take their wealth with them. They can certainly sell their homes and their shares and take the monetary value with them – but the assets won’t have moved. It’s obvious in the case of bricks and mortar that the homes will stay in the same place under new ownership, but so, in general terms, will the real assets underpinning share values. Even in the case of a successful business built up by a successful entrepreneur (which might be a genuine case of wealth creation) who decides to emigrate and take his wealth with him, the way to realise the best value for his assets is to sell them to a new owner, not to destroy them. And the extent to which people can continue to own assets whilst domiciled elsewhere and avoid UK taxes in consequence is a matter of UK taxation policy, not an automatic result.

There are some good arguments against trying to assess and tax wealth. There are even some not-quite-so-good arguments against doing more to tax income arising from wealth. Fear that a few whingeing millionaires will emigrate just isn’t one of them.

Save the alligators!

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Americans have a saying that when you’re up to your waist (although they generally refer to a similarly-located part of the anatomy) in alligators, it’s difficult to remember that your original objective was to drain the swamp. In less expressive language, sometimes, even if people start a project with a clear objective, the practical difficulties encountered along the way can assume such a significance that the aim becomes more of a distant aspiration: killing alligators becomes an end in itself.

To the surprise of no-one except the current and previous governments, reducing net immigration (assuming one thinks that to be a problem in the first place), turns out to be rather more complex than their rhetoric has ever suggested. ‘Stopping the boats’ is really just one – and not a particularly large one at that, in the scheme of things – element of the problem. Short of starting a war with France by forcibly landing people back on French beaches, deliberately killing the occupants of the boats, or simply ignoring international commitments and regulations such as the law of the seas, there isn’t actually any way of stopping the boats at all. Once they enter UK territorial waters, the UK government has a legal obligation to ensure the safety of the occupants, and prior to that point, the French government has a similar responsibility.

Sir Warmonger’s latest wheeze to address the issue is to make an agreement with France for a ‘one in, one out’ policy, initially capped at a maximum of 50 each way per week. The mathematically competent (a category which obviously excludes government ministers) will immediately note two things about this proposal. The first is that minus one plus one nets out to nil; the proposal would reduce the total net migration into the UK by precisely zero. And the second is that 2600 a year is around 6% of the total number making the crossing; a proposal to swap 6% of those making the journey for a different 6% is supposed to deter the other 94% from even trying, presumably by encouraging them to wait to see if they can get into the select 6% who will be allowed a safe crossing. Clearly, the PM hopes that those members of the electorate salivating over the prospect of deporting people in chains are as mathematically challenged as himself.

Interestingly, one of the main arguments put forward by those who think that the use of force, detention, and deterrence to stop people crossing is the wrong approach has been that a better alternative is to allow safe crossing and perform a proper assessment of asylum claims before deciding whether or not to deport. The proposal looks a lot like doing exactly that, except on such a small scale as to make no difference. It’s all a form of scope creep in reverse. Reduce net migration becomes stop the boats becomes stop some of the boats becomes swap some of those arriving by boat for some others who didn’t get in a boat. Then, it can be declared to be a huge success. Just about the only certainty is that absolutely no alligators get killed in the process. I suppose the animal rights lobby might be pleased about that, even if the alligators were only ever an allusion.

But who decides the selection criteria?

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Reluctant as I am to agree, ever, with anything which escapes the mouth of Nigel Farage, he does occasionally come up with half a good point. There was an example last week with his suggestion that it ought to be possible to appoint non-politicians to positions as government ministers if they have particularly relevant experience and knowledge, along with the corollary that the act of being elected to the House of Commons doesn’t magically confer relevant knowledge, experience, or even basic ability on those elected to the extent that they suddenly become capable of running a government department.

There are at least three reasons why it’s only half a good point, though. The first is that, if being an elected member of parliament for the majority party does not confer the necessary qualifications for becoming a minister, then being the leader of such a party doesn’t confer the necessary qualifications for becoming prime minister either – he is hoist by his own argument, which ends up sounding like an argument against democracy. The second is that governments can already appoint non-elected politicians to become ministers by the simple expedient of giving them a peerage. And the third is his counter assumption that being a successful business person somehow does confer the necessary attributes for becoming a minister. That overlooks the fact that there’s a huge difference between supplying goods or services to make a profit and supplying goods and services to meet identified social needs.

One of the theoretical strengths of the US system (although, as we are seeing currently, it’s more theoretical than actual) is the clear separation between the three branches of government – the executive, the legislature, and the judiciary. It’s a distinction which the vague and not fully codified constitution of the UK fudges, leaving us with a legislature full of people most of whom are, have been, or want to be part of the executive. It’s prejudicial to them delivering critical scrutiny. A clearer separation might well lead to better scrutiny and accountability – the idea that people have to sit in the legislature in order to be scrutinised and held to account might be familiar, but it is a strange one when analysed more carefully. And a legislature which focussed more clearly on its key role of legislating might do a better job of it than one where threats and blandishments ‘encourage’ people to toe the government line. Electing the executive and the legislature separately clearly has some advantages.

But, but, but… Holding a separate election for the head of the executive and then allowing him or her to select the best-qualified people to serve as cabinet ministers only works if the elected head of the executive him or herself has the necessary attributes for the job, including the ability to select the right people for other jobs. As the US is so amply demonstrating at present, electing a narcissistic criminal sociopath to the role can easily make things worse. If the head of the executive then puts total loyalty to him or herself as the main – or only – required attribute, it’s an understatement to say that it doesn’t necessarily lead to an adequate and able cabinet.

The basic point which Farage made – that governments should be able to choose people from outside parliament to run ministries – has a great deal of merit, especially where the legislature is small, such as in Wales (a Senedd where the number of members from the party or parties forming the government is unlikely ever to exceed 50 by very much, and where all of those have been selected on the basis of an internal party popularity contest, doesn’t exactly provide a large pool from which to recruit ministers; and the more powers the Senedd gains over time, the more obvious that will become). All the objections about scrutiny and accountability of people outside parliament can be overcome if the will is there – partly perhaps by giving the legislature a strong role in confirming appointments and the right to dismiss ministers as the ultimate sanction. The problem with Farage’s proposal, however, is that it doesn’t really overcome the perceived problem of appointing people not up to the job, because it doesn’t address the key questions, namely who decides who is suitable for the job, and what criteria do they use? It would be a mistake to completely dismiss the point which Farage has raised; but as it stands it’s over-simplistic, with little sign of any intention to fill in the gaps. But then, over-simplifying complex issues is something of a stock-in-trade for him.

How many people is too many?

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Politicians are increasingly worried, it seems, about the low birth rate in the UK – a situation mirrored in many other developed countries. For some of them, there’s an element of racism in the argument: they are concerned that if we don’t have a locally-born workforce, the gaps will be filled by migration. The 20-year plus lead-time on sourcing new employees by increasing the birth rate is a bit of a problem, of course, but one they largely seem inclined to ignore. The other motivation is an economic one – a concern that a falling birth rate coupled with a rising population of older people means that fewer people are working to support more who are not. But the extent to which that is a ‘real’ problem, rather than one based on a particular ideological construct about economics, is a question which largely goes undebated.

There are various theories around about how many planets’ worth of resources would be needed if we were all to live at the standard of, say, the UK in 2025. There are problems with the detail of all of these, dependent as they inevitably are on a series of assumptions and guesses. The basic underlying point, though, is almost certainly true: the resources of the Earth, as currently being utilised, are inadequate to support extending the lifestyle of the richest countries to all humans. Increasing the population will only make that worse, and inequality is the inevitable result. The sort of inequality, in fact, which is one of the biggest drivers of migration.

There is an article on the Guardian’s website by Larry Elliott which challenges the prevailing consensus that a falling birth rate is necessarily a bad thing. It even suggests that a falling birth rate could be a good thing. He sets out some economic theory behind that: whilst a falling population might reduce GDP in total, it could increase GDP per head, a much more useful way of measuring economic performance as it affects individuals. He also suggests that it would require policy changes. I agree, but I’m not sure that changing a few policies such as getting more people into work will be radical enough. We also need to rethink what the economy is and how it works.

Capitalist ideology posits that there are only two productive forces at work in the economy. The most important (and therefore the one to be most handsomely rewarded) is capital itself, and the second is labour (which is what actually creates value). The political parties don’t often put it in such stark terms, but the persistent references to ‘working people’, as though the rest of us don’t count, are more than a minor clue. In such an economic system, those who provide neither capital nor labour – the young, the old, the sick, the disabled – are a ‘burden’ on those who do, who must give up part of ‘their’ wealth or income to support the non-productive.

It isn’t the only way of looking at an economy, however. An economic system is a human construct, not the result of some divine law. From an alternative perspective, the question is not how we maximise the return for those who supply capital and labour, and squeeze the living standards of everyone else to achieve that, but how successful an economy is in serving all members of the society which hosts it. If the output of an economy ‘belongs’ to all, then tax is not an imposition taking money away from those who’ve ‘earned’ it, but a mechanism for sharing and distributing the rewards of economic activity within the society. ‘Tax’ might not even be the best word to describe that. In such a scenario, a change in the age balance of the population doesn’t require a higher birth rate: that’s an answer to the wrong question. The question we need to be asking is how we shape an economy and share the benefits in such a way that it meets the needs of all. Productivity and equity are more important than demographics, but few seem to be asking the right questions based on that.

It's all about adjusting the variables

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Some websites have slider tools on them where the user can adjust one or more variables and the clever computer will calculate the value of another variable as a result. Things like loans, for instance: you adjust one slider to show the amount required, another to adjust the period over which you wish to repay and the computer tells you the monthly payments. Sir Starmer seems to be using a similar tool for what he rather dishonestly calls welfare ‘reform’.

In his case, the variable he adjusts is the number of people pushed into poverty as a result of any given proposal, and the output tells him the size of any saving to the Treasury and the size of the majority in favour in the House of Commons. He started out with a $5 billion saving, and the first answer it gave him was 250,000 more people pushed into poverty. Sadly – for him, if not for those affected – the second part of the result saw the majority slipping deeply into negative territory. He duly adjusted the slider so that ‘only’ 150,000 more people would be pushed into poverty. The savings came down by about £3 billion, but yesterday morning it became clear that the majority would still be negative. Having run out of time to play with further values in order to assess the outcome, he kicked the ball into the long grass and decided to conduct an in-depth study into possible reforms and their impact. Cue huge sigh of relief from those being dragooned into voting for the bill, and a significant majority in favour of a bill which now has a net saving of around zero – or maybe even a slight net cost.

The issue hasn’t gone away, though. And nor has the basic approach. Whatever fine words are spoken, they’re still asking the same question, which is, in essence, ‘what is the maximum number of people which we can push into poverty and still ensure that enough Labour MPs will vote for it to get it through the House of Commons?’ The review is little more than a cover for spending more time playing with that slider. It’s just going to take a little longer to discover the tipping point of the conscience of individual Labour MPs.